Amgen’s Decision to Focus on Injectable Drug and Other Products in Obesity Treatment
Amgen, a pharmaceutical company, recently announced that it will no longer be pursuing the development of an experimental weight loss pill. Instead, the company will be focusing its efforts on its injectable drug and other products in development for the treatment of obesity. This decision comes amidst intense competition in the weight loss pill market, with Novo Nordisk and Eli Lilly dominating the industry. Analysts predict that Amgen could face significant losses, possibly amounting to $100 billion by the end of the decade. However, there are still opportunities for Amgen to gain market share.
During a recent earnings call, Amgen’s chief scientific officer, Jay Bradner, stated that they will not be pursuing further development of the oral weight loss pill due to its profile. Instead, the company is investing in MariTide, an injectable obesity treatment, and several other preclinical assets in obesity. Amgen is currently conducting an ongoing clinical trial for MariTide in obese or overweight adults without diabetes. The company plans to release initial data from this trial and proceed with a late-stage trial in collaboration with regulators. Additionally, Amgen has plans for a stage two trial for its diabetes drug and is developing other weight management drugs.
It is worth noting that Amgen has already discontinued another weight loss pill called AMG-786 in the past year. Pfizer’s obesity pill, Danuglipron, was also discontinued in December due to difficulties in tolerating the drug during a mid-stage trial. However, Pfizer is currently working on developing a once-daily formulation of that medication.
Investors are closely watching Amgen’s weight loss pill treatment pipeline, as the company hopes to differentiate itself from its competitors with its unique approach. Amgen’s experimental injection offers a different weight loss mechanism compared to existing injectable drugs. Like Novo Nordisk’s Wegovy and Eli Lilly’s Zepbound, Amgen’s treatment activates a gut hormone receptor called GLP-1 to regulate appetite. However, unlike Zepbound, Amgen’s drug also blocks the GIP hormone receptor. GLP-1 suppresses appetite, and Wegovy may also help reduce sugar and fat absorption. Based on clinical trial data, Amgen’s injectable treatment may also assist patients in maintaining their weight after they stop taking it. Additionally, Amgen aims to make its drug more convenient than the current weekly medicine by testing a once-a-month dosing regimen.
In a study published in Nature Metabolism in February, it was revealed that patients taking the highest dose of MariTide (420 milligrams per month) lost an average of 14.5% of their body weight in just 12 weeks.
Amgen’s First Quarter Report and Future Outlook
Amgen’s first-quarter financial results showed a loss of $113 million, or 21 cents per share. This is in contrast to the prior year when the company earned $2.84 billion, or $5.28 per share. However, after excluding certain items, the earnings per share were $3.96. In the previous year, Amgen generated $7.45 billion in revenue, representing a 22% increase. A significant portion of this revenue, $914 million, came from Tepezza, a treatment for thyroid eye disease.
Despite the challenging quarter, Amgen saw a 6% growth in product sales (excluding Horizon Therapeutics drugs). Repatha, a cardiovascular drug, Tezspire, a severe asthma treatment, and Blincyto, a blood cancer therapy, all experienced double-digit volume growth during the first quarter. As a result, Amgen has revised its full-year guidance and now expects revenue to reach $32.5 billion by 2024. The previous guidance ranged from $32.4 to $33.8 billion. For this year, Amgen anticipates earnings of $19-20 per share, compared to the previous guidance of $18.90-20.30. Analysts from LSEG predict that Amgen will achieve $32.95 billion in revenue and $19.48 per share in adjusted profit.
In conclusion, Amgen’s decision to focus on its injectable drug and other products in development for obesity treatment reflects the intense competition in the weight loss pill market. While the company may face significant losses, there are still opportunities for growth. Amgen’s unique approach with its experimental injection sets it apart from its competitors, and investors are closely following the company’s weight loss pill treatment pipeline. Despite a challenging first quarter, Amgen has seen growth in product sales and has revised its full-year guidance accordingly.